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Copyright

Vincent Charlet; Mathieu Plane; Francesco Saraceno

Published On

2024-12-11

Page Range

pp. 31–44

Language

  • English

Print Length

14 pages

2. Public Investment and Industrial Policy in France

Chapter of: Investing in the Structural Transformation: 2024 European Public Investment Outlook(pp. 31–44)
This chapter first traces the long-term evolution of public investment in France, noting how this is mostly channelled through local governments and how, while comparatively high with respect to other advanced economies, the public capital stock and the general government net wealth have been steadily decreasing since the Global Financial Crisis of 2008. After the COVID-19 shock, despite the 2021 “Plan de Relance” and the 2022 “Build the France of 2030” program, public investment has remained surprisingly flat. The chapter then discusses the recent evolutions in French industrial policy objectives. The Lisbon Strategy was centred on boosting productivity through innovation and climbing the value added ladder. The response to the crisis of 2008 marks a first change, with a strong emphasis on price competitiveness and cost reduction (including through corporate tax reduction). Since the early days of the pandemics, then, the notion of “industrial sovereignty” has very quickly eclipsed that of competitiveness, with policies aimed at reindustrialization especially in strategic sectors. The chapter concludes that these frequent changes indicate an excessive short-term focus among French policy makers, incompatible with managing long-term structural transformation.

Contributors

Vincent Charlet

(author)
https://orcid.org/0009-0009-7978-5667

Vincent Charlet is the Executive Director of La Fabrique de l’industrie, a think tank he contributed to launch in 2011. Supported by the French manufacturers’ associations, co-chaired by Louis Gallois (former president of Stellantis, former CEO of Airbus Group) and Pierre-André de Chalendar (former CEO of Saint-Gobain), La Fabrique de l’industrie publishes robust studies on the performance, transformations, and assets of industrial companies and on the professional trajectories of their employees. After training as an engineer, Vincent Charlet devoted himself to the analysis of public systems and the management of change. He first participated in initiatives aimed at renovating the research and innovation system in France (evaluation, construction of indicators, foresight). He notably led the FutuRIS project, a prospective operation supported equally by major private R&D players, public research establishments. and the State, from 2006 to 2011.

Mathieu Plane

(author)
Deputy Director of the Analysis and Forecasting Department at the OFCE Research Center in Economics at Sciences Po, Paris

Mathieu Plane is a Deputy Director of the Analysis and Forecasting Department at the OFCE Research Center in Economics, Sciences Po, Paris. He is in charge of economic forecasts for the French economy and works on economic policy issues. He teaches at Sciences Po, Paris and at the University of Paris Pantheon-Sorbonne. He was, in 2013–2014, economic advisor to the Ministers of Economy, Industry, and the Digital Sector. He has recently published, in collaboration with other authors of OFCE, 25 Years of Monetary Union: The Eurozone through Its Crises; Growth Up Against Fiscal Recovery: Economic Outlook for the French Economy 2024–2025, and French Economy 2025 by Éditions La Découverte, Repères collection.

Francesco Saraceno

(author)
Deputy Department Director at OFCE at Sciences Po, Paris
https://orcid.org/0000-0003-0121-4329

Francesco Saraceno is Deputy Department Director at OFCE, the research centre in economics at Sciences Po in Paris, and Professor of Practice at LEAP-Luiss, Rome. He holds PhDs in Economics from Columbia University and the Sapienza University of Rome. His research focuses on the relationship between inequality, macroeconomic performance, and European macroeconomic policies. From 2000 to 2002 he was a member of the Council of Economic Advisors for the Italian Prime Minister’s Office. He teaches international and European macroeconomics at Sciences Po, where he manages the Economics concentration of the Master’s in European Affairs, and in Rome (Luiss). He is Academic Director of the Sciences Po-Northwestern European Affairs Program. He advises the International Labour Organization (ILO) on macroeconomic policies for employment and participates in IMF training programmes on fiscal policy.